Monday, March 21, 2016

Colombian oil crisis could force a sale of Pacific E&P

Late last week, the Colombian press quickly followed up on the Wall Street Journal’s report that Pacific Exploration & Production, the largest independent oil producer in Latin America, is considering several purchase offers in an attempt to avoid bankruptcy. While the WSJ simply reported on rumors, several hours after the report was published, Pacific confirmed that it is having discussions with interested parties to restructure the company’s debt.

Portafolio noted that Pacific declined to specify just how many offers the company has fielded. Pacific also stressed that these are simply initial exploratory conversations, and no formal offers have been presented. According to the WSJ, Pacific’s share price has fallen by 95% in just the last two years. The article concluded that, even if Pacific does not want to admit it, the company is already bankrupt.


In Colombian coal-related news, Colombian daily El Tiempo reported on new technology that could allow for more intelligent monitoring of coalmines. Colombia, one of the worlds leading producers of coal, is leading the development of new technologies to predict developing risks and problems in underground coalmines. Despite the fall in global mineral prices, coal exports still comprise a key part of Colombia’s economy, particularly at a time when the country’s reliance on oil exports looks less and less secure.

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